FreightWaves reported:
".. the U.K.’s exit from the EU (Brexit), now delayed until the end of January [2020], has prompted a reconfiguration of the European logistics landscape, fueling a scramble for logistics properties in the northwest of continental Europe, particularly in the Netherlands.
Cuno Vat, CEO of Neele-Vat Logistics, a Netherlands-based logistics provider, said that while the uncertainty around Brexit had been confusing for business, new opportunities have emerged.
“We’ve seen a five-fold increase in requests from overseas companies currently with setups in the U.K. that want to redesign their supply chain. They are considering the Netherlands as a location and want us to be their business partners,” he said.
The CEO explained that foreign companies established European bases in the UK to benefit from the advantages of English as a first language, openness to immigrants, a reliable legal system and relatively low taxes. Yet with Brexit comes potential labour shortages, customs checks and border delays and now they see continental Europe as a safe haven.
Some food manufacturers, in the food industry apparently, have done something on a short-term basis - building up temporary stock on both sides of the Channel to guard against short-term disruption but another supply chain manager, Stan de Caluwe, at Holland International Distribution Council (HIDC), told Freight Waves his organization was in talks “with various logistics companies” about moving from the U.K. to the Netherlands. Others are making substantial, long-term commitments to shifting large parts of their businesses out of the U.K.
Mr de Caluwe said, "Many are starting with additional solutions such as a second hub here and one in the U.K., then longer term are looking to move their European distribution center here and will then service the U.K. from here.”
The report says:
Wolfgang Lehmacher, a leading logistics consultant and the former head of Supply Chain and Transport Industries at the World Economic Forum in Geneva and New York, said the eventual departure of the U.K. from the EU would have a major impact on the logistics landscape of the continent and the supply chain strategies of shippers.
“When the U.K. separates itself from the world’s second-largest trade bloc, regardless of the efficiencies the U.K. may achieve at its borders, the barrier becomes an additional stop and incremental cost in the supply chain of a not so large market,” Lehmacher explained.
He continued, “So, of course, Brexit changes where goods are manufactured, stored and how they are routed during the distribution process.”
Brexit, as the report makes clear is driving manufacturers to migrate production and distribution of EU goods out of the U.K. to continental Europe. In the cases cited by The Guardian they are shifting stock in bulk so the consignment only has one (or a small number) of custom and safety/security declaration but also so they can pay VAT on behalf of their end consumers and reclaim it from the member state authorities.
It makes perfect sense, as the DIT adviser had to privately admit. It was perhaps the moment when delusion had to come up against reality. My fear is that this is or will become ever more widespread as other businesses see the logic. And more importantly, companies who do make the move will learn how easy it is to manufacture in the EU, how widely English is spoken and how hard-working and diligent the staff are.
Mr Lechmacher added:
“Post-Brexit, the U.K. cannot function any more as a key entry and exit gateway of the EU. Too many factors may hinder the fluidity of the supply, ranging from administrative burden to potential delays.”
"Flows of goods that can, will avoid the U.K. and U.K. warehousing and distribution facilities will be closed and reopened in markets in the EU, mostly in the Benelux countries where most of the EU distribution centers are located.”
Finally, don't forget this report was from November 2019 and it ends with Jorn Douwstra, business manager for international trade and investment at Rotterdam Partners, saying:
“We think that a lot of multinationals already have a plan to move,” he said. “A lot of small businesses in the U.K. don’t know what to do and are waiting until there’s a final decision on Brexit. And we see a lot of mid-size companies trying to make up their minds.”
Well here we are in January 2021, many have already moved and others are now making up their minds and it is not good for the UK, Jobs and tax revenues will suffer.
